The Royal Institution of Chartered Surveyors (RICS) released figures showing that December became the fifth consecutive month of falling house prices. The survey also showed that new instructions to sell property actually rose for the first time in six months, indicating perhaps that homeowners are keen to sell before the market worsens. Surveyors expect price falls in all UK regions during the next three months. A spokesperson from RICS said that the underlying conditions of the housing market are ‘vastly different’ to those in place in the 1990s housing recession, and ‘supply would have to loosen considerably before prices experience a significant dip’.
Fears that a US recession is on its way led to a sell off in global equity markets yesterday. European and Asian markets closed between 1 and 3.4 percentage points lower – UK’s FTSE closing down 1.3 per cent, Germany’s DAC down 1 per cent, while Japan’s market value fell to a 2-year low, down 3.4 per cent. The share price slide was triggered by a quarterly end-of-year loss of £5 billion at US bank Citigroup. The bank is the world’s biggest and said the loss had been caused by a £9 billion exposure to bad mortgage debts.
Taylor Wimpey, the UK’s largest housebuilder, is also showing market fatigue. The group, recently formed by the merger of George Wimpey and Taylor Woodrow, said market conditions in the UK were ‘subdued’ in the second half of 2014, resulting in a 19 per cent reduction in orders. The group said it did not think they British housing market would get as bad as the United States, and expected the US markets to start recovering in 2016.
Chancellor Alistair Darling insists that the Treasury will continue to play a key role in government decision-making in areas of housing, science, planning and climate change. Observers thought that when Gordon Brown left the Treasury the department would cease to play an active role in developing policy and ideas. Shadow Chancellor, George Osborne, dismisses his government counterpart’s comments, and says that taxpayers are failing to get value for money from public services because government departments are too bound up in the setting of policy.
And finally, a pensioner who paid £60,000 for his home 35 years ago is refusing to sell up even after receiving offers as high as £10 million. The property is in the fashionable Sandbanks on Poole Harbour, which is the world’s fourth most expensive place to live, but owner Jack Holsgrove says that no amount of money will persuade him to sell up. ‘Why would I ever want to sell and live somewhere else?’ he asked, before adding that his granddaughters loved coming on holiday to his house and would kill him if he sold the property.